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I have always taken a broad view of the regulatory mandate that all "participants" be provided with the SAR. To me, this means any individual with an account balance under the plan. The client is asking whether this includes former employees with deferred vested balances, laid off employees, etc. I am not aware of an exception to this. However, I don't believe that DC plans have to worry about providing the SAR to "beneficiaries" entitled to future benefits.

As always, your expertise and experience would be most appreciated. I have not found anything on point.

Thank you.

pj

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From the 2007 Green Book:

Q&A 2007-1, Reporting: Distribution of Summary Annual Report

To which plan participants must a summary annual report (SAR) be distributed? Participants as of the date that the SAR is distributed? Participants as of the end of the plan year for which the SAR is distributed? Individuals who were participants as of any date during the plan year for which the SAR is distributed? Individuals who were participants as of the beginning of the plan year for which the SAR is distributed?

EBSA STAFF RESPONSE

The Department’s regulation at 29 CFR § 2520.104b-10 provides that the plan administrator shall furnish annually a SAR to each participant and to each beneficiary receiving benefits under the plan within nine months after the close of the plan year or two months after the due date for filing the Form 5500 Annual Report/Report (including approved extension). The Department’s regulation at 29 CFR § 2520.104b-1(d) states that participant status for this purpose is governed by the definition of “participant covered under the plan” set forth in the Department’s regulations at 29 CFR 2510.3-3(d). It is the view of EBSA staff that a SAR must be distributed to each participant who was a participant covered under the plan at any time during the year to which the SAR relates and to each pension plan beneficiary receiving benefits at any time during the year to which the SAR relates. See 29 CFR § 2510.3-3(d) for information on when an individual is no longer a participant covered under the plan.

EBSA staff noted that beginning with the 2008 plan year, the Pension Protection Act of 2006, Section 503, eliminates the SAR requirement for defined benefit plans subject to the pension funding notice requirement in ERISA section 101(f).

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

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From the 2007 Green Book:

Q&A 2007-1, Reporting: Distribution of Summary Annual Report

To which plan participants must a summary annual report (SAR) be distributed? Participants as of the date that the SAR is distributed? Participants as of the end of the plan year for which the SAR is distributed? Individuals who were participants as of any date during the plan year for which the SAR is distributed? Individuals who were participants as of the beginning of the plan year for which the SAR is distributed?

EBSA STAFF RESPONSE

The Department’s regulation at 29 CFR § 2520.104b-10 provides that the plan administrator shall furnish annually a SAR to each participant and to each beneficiary receiving benefits under the plan within nine months after the close of the plan year or two months after the due date for filing the Form 5500 Annual Report/Report (including approved extension). The Department’s regulation at 29 CFR § 2520.104b-1(d) states that participant status for this purpose is governed by the definition of “participant covered under the plan” set forth in the Department’s regulations at 29 CFR 2510.3-3(d). It is the view of EBSA staff that a SAR must be distributed to each participant who was a participant covered under the plan at any time during the year to which the SAR relates and to each pension plan beneficiary receiving benefits at any time during the year to which the SAR relates. See 29 CFR § 2510.3-3(d) for information on when an individual is no longer a participant covered under the plan.

Many thanks! Like finding a needle in a haystack!

EBSA staff noted that beginning with the 2008 plan year, the Pension Protection Act of 2006, Section 503, eliminates the SAR requirement for defined benefit plans subject to the pension funding notice requirement in ERISA section 101(f).

Thank you.

pj

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